Archive for January, 2011

Phil Mickelson has done it again. He’s demonstrated an evolution in his maturity level and game-savvy. He realizes that even if you “have game,” playing safer odds repeatedly often wins out over reckless gambling. Yesterday, in the Farmer’s Open in San Diego, trailing Bubba Watson by one stroke, he opted to “lay up” behind a creek rather than “going for it.” His calculation was that a bad shot would ruin his chances, whereas the safe shot gave him a slightly better chance of winning the hole. Even when Watson holed out to maintain his lead, Mickelson had some chance left: to try to hole out a 70-yard eagle chip.

Mickelson came second this time around, beaten fair and square by Watson. But he collected $626,400 for his troubles. You can’t win them all. And he’s won 50 professional golf tournaments in his career.

In rare instances, a gamble is appropriate. A “knockout blow” that people remember forever, like Y.E. Yang at the 2009 PGA, becoming the first player ever to beat Tiger Woods from behind in a major. Facing tremendous pressure and tasting victory in a major over the ominously confident Woods, Yang could have played safe and still won; he led by a stroke. Instead, he hit a perfect, improbable 3-hybrid over a big tree, to within 8 feet of the hole, to seal the deal. But such moments happen more rarely than we believe. Repeated high-stakes gambles are generally a losing strategy.

Popular UK novelist Tony Parsons gives us this aphorism: “When a man is 30, he wants to be free. At 40, he wants to belong.”

Who knows, maybe it’s true.

In a perverse way, this might explain the difference between Jerome Kerviel and Bernie Madoff. Or why, at 37, Larry Page wants more than anything else to act like a grownup, and run Google.

But enough about all that. We’re here to talk about Phil Mickelson. And, as usual, your PPC campaigns.

Mickelson became notorious early for his prodigious drives into the deep rough and his low-percentage gambles that often knocked him out of the running instead of into contention. It was only when he resolved to bend the existing rules to his benefit, rather than throwing out the rulebook entirely, that he reached new heights of success.

Perhaps Mickelson’s most famous rule-bending episode occurred during the 2006 Masters, where he did something that was perfectly inside the rules – but not a single other player in the field even considered it. In keeping with the rules of golf, Mickelson carried 14 clubs in his bag. Two were drivers. One, an inch longer with a slight tweak to allow the ball to draw from left to right. The other, intended to hit it more or less straight, or fade slightly from right to left. The end result: fewer fairways missed, and as Mickelson put it, “half the trouble.”

Rather than raging against the rules, Mickelson’s equipment maneuver actually kept him more obsessively “down the middle.” He looked carefully at what was allowed, and saw more flexibility on the menu than other people did. His trick to winning is to play more by the rules, not less.

You’d find the same tendency in challenging logic and strategy games as well, from chess to Scrabble.

Paid search, too, feels like it has a lot of tight, constraining rules. But like chess, once things get started, the dynamic flow allows for a breathtaking number of permutations. Follow the rules better, think of the stuff you can buy if you win, and you won’t be bored.

In a field of relative amateurs, most of whom will be trying to make their mark with “clever” tactics that don’t work, you’re bound to make it onto the leaderboard if you focus zen-like on perfecting fundamentals. While others are trying to impress their friends around the virtual water cooler with long-tail keyword research and Quality Score myths, why not take a few weeks to practice your focus just on writing more effective ad copy? (Of course, you won’t be done in just a few weeks. Some of the theories you seek rock-solid statistical support for may take a year or more to prove out in a large, granular account.)

Here are four key examples of thinking way inside the box. Test and hone these tactics and you’re bound to profit.

Plain, plainer, plainest ad copy. Just communicate with prospects. Don’t try to out-think them. If you’re going back to work on an account full of ads that have been trying harder and harder to grab people’s attention, why not simplify instead of trying to be more clever or creative? Here is a rough approximation of three real world headlines I recently worked on. The existing ads were poor performers – they tried to grab the searcher’s attention with (obviously disguising the real ad somewhat here): “Do You Ride Tiny Elephants?” Everyone doing a search for “ride the biggest bloomin’ elephant I can afford” knows they don’t want to ride a tiny elephant. Instead, I tested “Riding Elephants? Go Big.” It worked better. Then I simplified it further to “Big Elephant Experts.” That one did the best. Why? Because we’re playing by the rules. The high-intent customer’s rules. Their mental map of what they expect and hope to find.

For the customer, it’s quite possible that coming up with the idea to ride the big elephant was enough mental strain for the day.

DKI. It shouldn’t be too surprising that there isn’t a consensus as to whether it’s best practice to use Dynamic Keyword Insertion in headlines. Quite simply, in some contexts it works, and in others it doesn’t. It’s too easy, though, to fall into a pattern of not testing it because you’ve found it usually fails for your accounts from an ROI standpoint. As the new year kicks off, retry DKI in headline tests throughout your accounts to see if it might succeed in some cases. It’s the ultimate example of rule-following, in that its purpose is to mirror the user’s query and give ‘em what they want. Often, there’s nothing more persuasive than the searcher’s own words.

Best call to action (or none). Have you fallen into the habit of tacking “Buy Now!” onto your ads and never trying anything else? Within the available character limits, there are dozens of other themes you can try: “Compare and Save,” “Check Out Feedback from 200 Customers,” coupon code discounts for a limited time, or of course, variations on no call to action if the available characters are better used to describe benefits or to signal e-commerce intent (like shipping; large enterprise focus; local or global reach; etc.).

Overweight winning ads in tests. Phil Mickelson cut his trouble potential in half by putting two drivers in his bag so that he’d be hitting the safest shot off the tee regardless of whether a fairway was dogleg left or dogleg right. Similarly, when you’re rotating ads and testing new contenders, run two or more safe, winning ads instead of just one. Always create at least one “copy” (with slight variations if you prefer) of your most proven ad to date, so that new contender ads don’t cost you too much money. Experiments are key; you can’t learn and improve without them. But by using this workaround, you can proactively manage how much of a bite out of your winning routine the experimentation should take.

Lately, consumers have become dimly aware of behavioral tracking online, to the point where government authorities have begun floating the idea of Do Not Track legislation. Intuitively, it seems to make sense, until you examine all sides of the issue.

Balanced out against other forms of advertising, and assuming a certain degree of common sense about privacy policies, consumer concern is unfounded. Would you rather live in a world of even more untargeted advertising? How about a world where a central government agency decides what the private sector is allowed to say to people?

‘Hidden persuaders’ mumbo-jumbo

There is still a lingering, superstitious belief that advertising is magically subliminal and can make people bend to its will. That also explains do-gooders gravitating from the sensible “don’t advertise smokes to minors” to the much more controversial “don’t tie happiness (toys) to high calorie meals aimed at children.”

Ultimately, there is a line we all draw, and ideally, in a free society we collectively arrive at a balance on such issues.

In the online world we have moved a long way from the outmoded belief that advertising is sinister, insidious, and akin to mind control. The reason is mainly data. Data that provides better fits with willing and interested customers.

Like all forms of advertising online, the current market equilibriums support better targeting and less annoyance. Advertisers who are both more relevant and who are willing to bid more will find better fits with more people who actually want to hear from them. That’s the lesser of many evils.

Another reason that online targeting is good, though, is permission. It’s annoying to see laxative ads on TV, so you’d rather mute them, or pay for a way to make them go away. It’s annoying to keep getting seed catalogs when you no longer want them, yet it’s a pain to cancel them.

Online, ideally there would be a way to opt out of certain kinds of ads — like those that target you based on previous behavior or personalized qualities you’ve exhibited while surfing the web — that you simply dislike for some reason.

You can’t easily opt out of all advertising online, for the same reason that it’s free to use the Google Search engine, Gmail, and to read all that free content. With no ad revenues, much of what you get online would disappear. Jimmy Wales’ megaproject uses a combination of volunteer labor and a tin cup donations approach, for those who prefer that route.

But what exactly does Do Not Track mean? Is it going to go farther than this? Well, hopefully not, in Google’s opinion. And in the opinion of 99.9% of Google advertisers.

Is DoubleClick’s cookie spyware?

The idea here is that you can opt out of “behavioral” forms of display advertising. How these work (with my adjective added) is essentially based on an “aggressive cookie” that maintains a file of websites that a user has visited that also contain that network’s cookie. For large networks like DoubleClick, the information about your behavior becomes that much more complete.

While there is no official definition of spyware, there is something of a groundswell of consumer distaste for these kinds of cookies. Some experts do not hesitate to call DoubleClick’s cookie spyware.

For some regulators and consumers, the concept of Do Not Track could conceivably become much more far-reaching, based on how little they understand the issues and tradeoffs.

By providing consumers with instructions for opting out of “tracking,” Has Google quietly left the door open for savvy consumers to undermine their whole business?

Nope.

What would undermine Google’s whole business is if consumers were able to opt out of the AdWords and Google Analytics (and other) forms of highly accurate ad tracking that allows advertisers to measure goals.

Google’s founders and top executives have long trotted out the Google AdWords system (and similar technologies) as the answer to the longtime advertising dilemma of “I know half my advertising isn’t working, I just don’t know which half.” Google is performance marketing.

If Google isn’t providing advertisers with performance marketing of a certain type, then it goes from a hugely profitable company to one that incurs staggering losses every year. Little wonder that it has hedged its bets aggressively, not only branching into local listings but touting less measurable forms of reach-based display advertising strategies.

I asked Google to clarify what their current opt-0ut management encompasses. Essentially, this type of tracking opt-out only refers to display ad networks and other forms of behavioral advertising and retargeting.

What has made the recent announcement worthy of mention is that Google is “enhancing” the opt-out decision so it won’t be lost anytime you clear cookies, change browser settings, etc. You’d use a plug-in to “hold” your opt-out preferences permanently.

This does not extend to all Google advertising cookies

Importantly, according to Google, this does not extend to all Google advertising cookies. Google replied: “No, for Google, it applies only to the Google DoubleClick cookie. But just to clarify, Google is not the only ad network that this affects. It also affects all members of the NAI who have opt-outs (which is to say, all of them). You’d have to check with each company if you wanted to know which of their cookies it applies to.”

Minor revenue impact

Combining the fact that behavioral advertising in the DoubleClick network makes up only a proportion of those ad revenues, with the fact that Google’s overall AdWords (and other) ad revenue streams currently dwarf DoubleClick’s, the fact that in these scenarios only 5-10% of users ever bother tinkering with their browser settings, and finally, the fact that such opt-outs don’t preclude revenue-generating ads from being served anyway (just likely lowers the average value to publishers of some of the ads), and the “instruction manual” Google has given to tracking-shy consumers amounts to a very minor revenue impact on the company.

Doomsday scenario

And yet the specter looms, as ever, that mass action by consumers or hard-line regulation could virtually wipe away large swaths of the digital advertising world. To simplify the argument somewhat, measuring online behavior and the performance of ads becomes extremely difficult without cookies. To date, the data loss faced by advertisers based on technical or cookie-blocking issues runs to around 10-15% of users — higher if you factor in many other forms of latency, collective buying decisions in the family, using multiple computers and devices, etc. If 99% of users were cookie-free, other solutions would have to be found, and those, too, could (conceivably) be banned. Here’s Google’s simple explanation of how to block cookies by default, etc.

Google, and the industry as a whole, have been fairly responsible about posting the type of information that would set online advertising back to the Stone Age. For the most part, the benefits of giving up some privacy have outweighed the drawbacks in consumers’ minds. But the slightly scary part for companies like Google — and most heavy online advertisers — is that a large part of the indifference has come from consumers simply not making a conscious choice about their privacy settings.

How likely is that to happen? It will happen if enough people get up on enough high horses to determine whether not just behavioral advertising, but all forms of online ad tracking, are as harmful as tobacco; or by contrast, a pro-and-con tug-of-war like we see with gas-guzzling high-emissions vehicles, junk food, and other “social harms.” Almost certainly, the legislation will be more draconian in Europe than in North America.

Since Google leaked the news that Google Offers is in the works to compete head-to-head with GroupOn, people have been rightly wondering if this news is big enough to hurt GroupOn’s momentum; big enough, even, to put a big dent in GroupOn’s rumored target IPO valuation of $15 billion (let alone GroupOn’s ability to bail out for $1-2 billion in the world’s most overpriced fire sale)?

Um, well of course this is going to hurt GroupOn, even if Google absolutely buggers this up, it’s going to be part of a channel-jamming, noise-creating nuisance for consumers… and that will cause GroupOn to ultimately recede into the background rather than continuing to benefit from consumers’ interest in deals and willingness to pay attention to GroupOn’s interruptions based on the novelty effect.

To be sure, Google has a history of failing to break into verticals using its size and influence alone, as this analyst suggests.

The bigger question becomes, what is the business that GroupOn has found itself in, anyway?

I’ve been mulling that over, and before the Google Offers leak came out, talked with some business owners who had successfully run big promotions through GroupOn and LivingSocial.

To build such a big revenue business so fast is astounding. It’s astounding because every media company wants to offer this type of access to customers so they can charge advertisers/businesses for that type of access. Old content companies did it with old-school controlled distribution and expensive content. New media companies have come up with rare breakthroughs in the degree of permission consumers were willing to give them: Google as a huge aggregator of other people’s content; AOL to Facebook as digital environmnents; etc.

GroupOn? Sudden growth into being identified with deals; opt-in email that people sign up for.

The barrier to entry? Well, at first maybe it might have seemed like the brand name might help GroupOn stay on a permanently elevated plane.

But if others are willing to spend and shout and bully their way into consumers’ minds and inboxes too, then GroupOn becomes a flash in the pan, drowning in noise.

Google may or may not be serious about winning in this space for the long haul. Regardless, Google needs to spend relatively little on PR, banner ads, and other creative methods of promoting Google Offers, to potentially drive a stake into the heart of GroupOn’s aspirations for a quick IPO. A couple hundred million dollars less in GroupOn’s IPO coffers is that much less competitive banner advertising, competitive hiring, business development, etc. that Google would need to worry about.

Worse, GroupOn and the other first movers will face severe pressure on the arrogant revenue shares they’ve demanded from businesses in return for access to their deal-happy customer lists. Google, and others, will undercut them. (This is one of Google’s primary segment-entry tactics. It kept AdSense ad revenue shares high for publishers, which made it hard for similar display ad networks to woo publishers; it undercut Paypal rates with Google Checkout.) This makes GroupOn’s business — and the whole deals sector — less profitable in a hurry.

Does that mean Google will win or lose here? Well, it’ll be an expensive win if they get there.

Google may have consumer attention in general, but consumers will still need to willingly opt into this service and then and pay attention to the deals. Google has had notable success in gaining (eventual) GMail adoption and even Chrome browser adoption, so if it’s in something for the long haul, it can gain mass adoption. But to get there, Google will need to promote the heck out of this to get folks to sign up, and when they do, guess where a lot of people’s Offers will go… yes, into the same spam-box they’ve set up for the other offer sites.

It’s a crowded space, with very low barriers to entry but high effort and expense required to gain opt-in, especially now that the GroupOn novelty has worn off and deal fatigue is setting in. That means an uphill climb for all players. And a win for those consumers who can put up with the deafening din.

Out here in “the-rest-of-us”-land, $50 million and up is a lot of money. $500 million and up is a whole lot of money. For “us,” above a certain level of wealth, you could offer the most interesting project in the world, and we might not be as interested in it as compared with, say, doing sweet jack all.

Not so for “the driven.” What would Tim Armstrong be thinking, wanting to go run AOL, instead of just playing around as an angel investor and attending summits and golf tournaments? Of course part of the appeal must have been to have the opportunity to meet a challenge that hadn’t been met; to be recognized; to be in charge or on top.

It seems that “we” regulars just don’t get it. We’re often told that in Silicon Valley, or among the “passionate,” “driven,” classes, it’s business as usual no matter how much you’re worth. And for a precious few, that’s true. It’s more likely, though, if in addition to having a whole lot of money squirreled away, and being passionate, and driven, you also get to run the show.

As it turns out, well-off Googlers aren’t completely different from the rest of us. Although there are quite a few high-profile folks at the company who work as hard as ever, it’s simply human nature that others — even some who formerly claimed that they would be “running Google forever” — wake up one day and say, “thanks very much, and good luck to you.”

1. Googlers are, more often than we realize, just like the rest of us. They and Silicon Valley culture may be better at hiding it. (But sometimes, worse.) The coolness of the job(s) and the high additional pay keeps them there longer than some of us might stay, having vested to the tune of $10 million or more, but I’m sure you could easily name hundreds of Googlers who have headed for the hills (or just started working a lot less hard) once they’ve reached that magic number. To retain such people actually requires insanely high pay, among other things. It’s hardly worth the money given how much talent is out there that will work for less.

2. This move is strangely reassuring because it feels like it is just confirming what had already evolved. In a way, all of these shifts had already happened. Imagine a couple of years of frustration of everybody checking with everyone else in the triumvirate, in odd and uncertain ways, when it started to seem neater and cleaner to go with Mr. Page as CEO.

3. Larry Page just got himself a bona fide, genuine, real-time job! It seems like the mature thing to do. Nice going, and all. But… This is possibly the most curious part of the whole thing. Will it last? Why does he want to do this? Probably the wrong questions to ask, given that Page has likely been “running Google” for a long time, and a lot more directly than we outsiders have been aware. Not to take anything away from the heavy involvement of the other two. Only in ultra-earnest Google culture would you see this kind of “well, young Larry’s been prepping for this formal type of role for a long time, and we think he’s doggone ready!” approach. The same thing is going on across the company, where Google’s process relentlessly trains and prepares very young, then a bit less young, and then still young but enormously seasoned and formally prepared, Googlers performing a wide range of functions. Personally, I think it’s flat-out silly to have someone like Larry Page wasting his time doing CEO stuff. But that’s Google. I’m sure he’ll ignore the CEO stuff he doesn’t care for (that’s the Executive Chairman’s, or ten other people’s, concern). It’s bound to cause headaches down the road, but again, when you and your closest best friends’ net worth runs to the billions, headaches don’t hurt as much.

4. Eric Schmidt’s tired of playing dad for very high pay, so he is gradually departing, starting with this move to recede into the Executive Chairman role. Especially since the vested shares in the company are worth many times that pay. By the time I stop typing this, Schmidt’s net worth will be about $6 billion. Do you think someone in those shoes will want to do this type of monkey work much longer? Schmidt’s parting tweet strikes an oddly casual note: “Day-to-day adult supervision no longer needed!” Is Schmidt plumping for the CEO job at Facebook? Expect Schmidt to spend more time on his hobbies, if he doesn’t care for the FB gig. (And plus, we can only hope, that’s ex-Googler Sheryl’s future job.)

5. Sergey Brin gets stripped of all titles other than co-founder. Either the others ganged up on him as some kind of enfant terrible who needed to be relieved of a formal operational role, or he is simply relishing the subtle power of being Late Stage Bill Gates Meets Wannabe Steve Jobs. Special projects both within and outside of Google, no doubt, no doubt driving innovation on world-changing technologies, but with no particular commitments made as to which projects, how much time spent, or specifics of the roles. Works for me. In his shoes, I’d be way happier than Larry; I also wouldn’t want any title other than Co-Founder.

6. Impossibly geeky people, no matter how seasoned, are so un-self-aware that it is possible that they put together this publicity photo completely oblivious of the hilariously obvious symbolism. Or maybe they’re aware of it and thought it was funny. In which case, maybe they don’t realize how it mocks the rest of us who actually take them all a little too seriously. In the photo, Larry’s driving. Yessir, he’s in charge now. Young Sergey’s in the back seat, firmly restrained. No chance he’s going to disrupt anything. And Eric, the ex-dad, is saying: “Have fun, boys. I”m done here!” He’s not getting into the car. His real car and driver are pulling up just off screen.

6a. This company, and this photo, really needs a Mom. But as mentioned, some time ago she departed for Facebook.

7. Will Aunt Marissa be taking over when Larry grinds the gears?

8. Google has invented a self-driving car. You can be sure they’re working on a self-driving company.

Last year, I received a perplexing voicemail from the perpetrator of one of the top (alleged) Ponzi schemes of all time. “I want to know your company!,” he chirped. Presumably, the fallen guru was seeking reputation management services. I Googled him: it wasn’t pretty.

You might think it strange that someone thinks they can rescue their reputation when they’ve swindled hundreds of people out of their life savings. Yet, even stranger is otherwise intelligent people’s willingness to participate in Ponzi schemes in the first place. To put it in perspective: in 1997, half of the adult population of Albania was invested in Ponzi schemes (prior to the inevitable collapse). It’s statistically impossible that all of those people were of below-average intelligence. Indeed, evidence shows that complex investment schemes tend to appeal to high-IQ individuals.

The point is that strong cognitive abilities don’t automatically lead to rational behavior. Given the number of forces pushing us toward irrational outcomes, according to author and psychology professor Keith Stanovich (“What Intelligence Tests Miss: The Psychology of Rational Thought”), “dysrationalia” will “continue to be ubiquitous.”

To back this up, Stanovich describes thinking dispositions that get the majority of people into trouble — regardless of IQ. One of these is tongue-twistingly called “serial associative cognition with a focal bias.” (See a chapter on that here.) When confronted with a problem-solving challenge, many of us bring not only our biases to the table, but also an aversion to proper experimental design. We should be trying to falsify our initial beliefs through scientific testing. But we don’t. Unless we have tailored training, we don’t have a habit of working abstractly on the construction of alternative models that might help us dig up the “real” truth as opposed to biased half-truths.

The reason we tend to stick to our often-misguided brands of self-guided or corporate groupthink “smarts” is because it’s mentally taxing to detach from our comfortable (highly evolved for survival purposes) ways of thinking, and to follow a more methodical process. (The first is what Stanovich calls the “algorithmic mind,” but we’d be more rational in many cases if we switched over to the “reflective mind.”)

To take an example from the realm of performance marketing: imagine your ad copywriter employing some decent creative methods, gathering impressions of the target market, and trying very hard to “do a good job” of empathizing with that market’s needs.

The result is highly persuasion-oriented, even emotional, ad copy. Affect-laden terms appeal to the potential buyer: “melt in your mouth pesto sauce,” “vintage balsamic vinegar,” etc. Tradition is also invoked: the family started in the confections business 75 years ago, so why not try that as an element of the messaging?

These are good ideas, but it’s too early to start getting attached to them. There simply aren’t enough good ideas here yet. And yet our tendency is to do just that: to cling to our early theories before a full consideration of other possible realities. We’ll ride those ideas like a hipster on a moped, even if the pavement’s wet and we forgot our helmet.

Why? Our brains want to shun extra mental processing. We have a natural tendency, Stanovich argues, to be “cognitive misers.” In natural selection, survival is good enough, so a brain that conserves energy makes sense. It’s not so great if you’re playing chess.

The antidote to dysrationalia in ad testing boils down to more extensive testing. And it should generally be less opinionated testing. Try a variety of parameters (geographic specificity, offers, copy length, dynamic headlines, benefits, third-party endorsements, and simplified wording); be brave enough to admit not knowing which one of them will carry the most weight.

In our real-world tests around the “melt in your mouth” foodstuffs, we made some unexpected discoveries. Mentions of the company’s tradition didn’t directly improve response, but there were weird exceptions. The beauty of search marketing is its granularity. If people in Georgia think differently (about pesto sauce, anyway), go with it!

As anyone who has tried to squeeze persuasive copy into 95 characters knows, the benefits and offers in your arsenal are not additive in terms of response. You have 95 characters to say your piece, and you can’t throw everything into the mix. (Even if you could do that on the landing page, attention is finite there, too.) That’s why extensive testing is so important in isolating the winning response factors.

Most companies and most copywriters never get to that stage, because they’re employing typical insider thinking, and they’re using the laziest forms of brain processing to try to “do a good job.” But no single copywriter is clairvoyant, no matter how brilliant they may be.

We’re not doomed to mental laziness and suboptimal outcomes just because switching modes of thinking is tiring. The key is in the simple word: process.

–

This column originally appeared at ClickZ on January 15, 2010. Reprinted by permission.

Until this global recession goes away, we’ll all be forgiven for wanting huge bang for buck in our marketing efforts. For folks with a lot of experience, I thought I’d put the question to them: what have they stumbled on in their career that provided a lot more mileage in terms of ROI than they would have expected going in?

My inbox was flooded responses and I also got a few answers on LinkedIn. I decided to pick two winners, one from LinkedIn, one from personal responses, and add my 2c as well.

The question posed was put exactly this way:

“In the past five years, name the single thing you did for your own business or a client business that did the most to explode bottom line business results on the least money. (It could be a relatively costly tactic if you still think the ROI or total ongoing profit were incredible, or ideally it would be something totally free or just a bit of sweat equity that really caught you off guard with its effectiveness.)”

For my friends who replied, I also hoped they wouldn’t just be promoting a technique or service that is their “hallmark” or “trademark,” but rather something offbeat that they may not be known for.

I can trace 80% of all of my current success, business, clients and engagements back to two specific people in my industry. The single thing that I have done that has contributed the most to my business was to cultivate friendships in the business and remember the referrals, recommendations and references that friends and associates have made. To me, there is no better business strategy than to develop and cultivate long-term friendships within your industry. And, of course, remember those that have been instrumental in helping you and thank them constantly for their influence.

And your prize, Matt, is…: Potent potable, TBD. Given your love of fine Scotch, Traffick is not sure we can afford your tastes, but maybe a nice wine or bottle of Canadian Club (it’s so Mad Men).

I believe the single best investment, and creator of long-term ROI, is to first ensure you have a phenomenal product or service and you put your customers (and employees) first. In this era of transparency, putting marketing before product, or “lipstick on a pig”, is a surefire way to waste every dime you spend.

Dirk, all we have for you is a mention. But it is honorable!

Traffick’s take: Information architecture has a powerful multiplier in SEO

We’re blown away by the power of one particular component in the SEO mix: for large sites or ecommerce sites especially, professional, meticulous, and appropriate information architecture and website architecture. We’ve had success with this technique in the past, but recently it really hit home again. Without doing anything else with the SEO (which is to come), being involved in a complete site redesign, with professional information architecture input, increased year-over-year, same-period search referrals by 40%, for a mature company that was already doing pretty well. The ROI on setting a solid *foundation* for long term SEO success is incredible. Or, put another way, there is huge opportunity cost in *not* doing it right. Done properly, sound architecture across the board sets the stage for years of unpaid search referral love.

It’s not free. Certainly, for very large sites, you’ll be budgeting a significant chunk of change. Depending on your company, it may simply be hidden as an “infrastructure” cost — but the real danger is not knowing whether your team has full coverage of the requisite professional competencies to nail the whole job. Likely, they don’t.

If you don’t have the capability in-house and you’re getting ready for a major site relaunch, should you invest in highly qualified outside help? Absolutely. It’s cheap compared with the risk of getting it wrong, and with the opportunity to reap six or seven figures worth of additional revenue annually from better search rankings.

Then, most advertisers barely understood the principles, and were easily satisfied with a few minor advances in functionality. That’s a far cry from today’s hyper-competitive atmosphere, where (at least for show), the trade shows and blogosphere simmer with boasts and complaints that new, mind-boggling features and data mining capabilities “aren’t advanced enough.”

Here’s the basic stuff we were working with back then:

Enabling “auto-bidding.” Following Google’s lead, Overture finally put in a bid discounter so you wouldn’t need a third-party tool to mind “bid gaps.” (Those gaps, indeed, were the catalysts for the whole field of PPC bid management software.) But guess what? You needed to enable the feature. If you didn’t, you chose to overpay. LOL.

Tracking URL’s. Without your own tracking URL nomenclature and means for dealing with keyword and ad segments, your analytics software wasn’t going to be much help. You can still use these, of course, but it’s less imperative if you use the integrated AdWords conversion tracking. At that time, the whole concept of tracking through to conversion (let alone other events) was seen as too much bother by 90% of advertisers. Many third-party agencies had yet to realize that promises to get that worked out should not be trusted to the client side. That mandate would sit on the shelf for months, or more.

Something we no longer have: data about competitors’ bids. That’s the exception that proves the rule, I guess.

Remember, Overture had no structure for Campaigns and Ad Groups, something that is tantamount to breathing air for later generations of paid search advertisers. Google’s engineers and planners came up with logical metaphors and workflow where the GoTo/Overture braintrust had barfed up a jumble of spaghetti-coded hell. So, on top your mega-list of keywords, I guess they had bolted on something called Categories, to help you report and assess more conveniently. Convenient, it wasn’t. Ugh.

Bidding strategy? At the time, the industry chatter was dominated by caterwauling about Overture’s “draconian” minimum bid increase to a nickel from a penny. When that went to ten cents, I expected to see SEO’s flying out of office tower windows. Fortunately, most SEO’s worked from their basement apartments, so that limited the risk.

Bidding higher into “premium” spot was the only reliable way to get well placed on Yahoo and MSN Search. Overall, channel reporting was nonexistent to poor, so you had better have some pretty good analytics capability.

And click fraud was rampant.

And the “networks” were just part of the search inventory, and hugely unpredictable in their traffic quality.

You needed a mega keyword list because Overture essentially used Exact Match in the old days, so you couldn’t broad or phrase match to increase your reach.

I love that Krista Lariviere over at GShift Labs posted some questions to think about, and some statistics, instead of “predictions for 2011,” regarding organic search referrals and your SEO strategy for 2011.

I actually have some answers to her questions. In my opinion, she makes some of the same mistakes my other SEO-obsessed friends, such as Rand Fishkin, have made in this “debate” between SEO and PPC.

Not to beat a dead horse, but the key disclaimer is, as always: organic search is a key channel, it’s not mutually exclusive to PPC (and vice-versa). And there is always much low-hanging fruit for companies who have quality content and products but who have failed to optimize for organic search.

Yet, Krista gets away with a couple of fast ones here, if we let her. Here are my direct answers to some of the questions she asks in her post:

KL:How does your organic search budget compare to your paid search budget? If you’re aware of a particular keyword phrase that works well in paid search why not optimize for that same keyword phrase in organic search?

Traffick: It sure would be crazy to have products and services that only had a shot at showing up on Google if you paid for AdWords clicks. But there’s a reason folks pay for those clicks. Paid search is much more apropos to many buyers, especially in hotly competitive keyword areas, and you can control your message and placement to a considerable extent on short notice. The problem with assuming you can just blithely optimize a page about orchids for organic search is that Google organic search is not meant to sell your orchids. You may or may not show up on Page 1 for user queries, in the “ten blue links,” and the ads, photos, news results, local results, YouTube results, tweets, blog posts, etc., may clutter things up (for users’ benefit) so that your 2002-era ten-blue-links optimistic-optimization doesn’t get the job done. PPC? If you’re hell-bent on selling those orchids, you can be right up in premium spot where users are looking. Yep, it’ll cost you. Organic referrals from ten blue links are down because Google has created universal/blended results styles. Businesses shouldn’t get their hopes up too high that vanilla SEO will drive the same traffic it did in 2002. So now SEO becomes a comprehensive strategy, too… and that’s hard work. Get ready to roll up your sleeves and take things up to a level of more of a 360-degree engagement approach.

KL: Are you able to determine your conversion rates on your email and paid search campaigns? Imagine an even higher conversion rate on an organic search campaign.

Traffick: First of all, let’s can the notion that there is such a thing as an “organic search campaign.” As noted above, get ready to be engaged in an ongoing way in keeping your digital world in order, and not missing out on any major SEO tactics and trends. A “campaign” this is not. Paid search is actually a campaign!

Now, as for imagining a higher conversion rate… Imagine all the people, living life in peace! An iterative paid search campaign must convert better due to relentless testing, great, tailored landing pages, etc.; that’s a reality because the economics force that reality. We see no evidence that organic search out-converts paid search. More to the point, again, volume is an issue businesses cannot ignore. Ad positions 3, 2, and 1 push those organic results down the page. So do other types of listings. If you’re in 4th or 5th organic spot (a tall order!), you might be at the very bottom of the page. If you’re a bit worse than that, you might be near-invisible on page 2. And there is no quick fix for that. Organic search is great in theory, but in practice the optimization process is uncertain, longer-feedback-cycle, and thus too passive for marketers to rely too heavily on it today.

KL:Exposure to organic search results almost doubles the likelihood that a prospect will visit a web site when combined with a paid search strategy (iProspect & comScore).

Traffick: Search is great, display is sometimes great, and we need to attribute ROI and volume to any of those channels. We cannot always neatly do this, which is when we fall back on “exposures,” “lifts,” and other workarounds.

I don’t know what gymnastics this study is trying to accomplish, other than comScore’s usual mandate of helping its partners sell display ads, but even the way the findings are worded make it sound bogus to me.

Exposure to listings result in visits to a landing page when people click. Period.

If you rank well in organic search, your CTR will be awesome and they will visit. If you heavy up on PPC, you’ll rank well on the page (above organic search results), and they will visit your landing page — period.

Certainly, one can imagine that if you judge “PPC strategies” from hotel companies who rank in 6th and 7th paid position typically, who are fortunate enough to rank high organically on those same queries, searchers will be less likely to click on the less-visible paid result — especially if they’re like 80-90% of searchers, not currently in “buy” mode, so are ignoring the ads!

The study cites “visits” to a website. What about purchases? Informational queries generate a lot of clicks from organic search, but may convert poorly.

Both organic and PPC are good for business. Studies like this, which can be interpreted as pitting one against the other, do marketers a disservice. PPC is not for every business. But it’s wrong to expect organic search to build your business, as it might have done in 2002. There is no need to criticize PPC to make the point that organic search marketing best practices should be followed. It’s good in itself: just not as good as you might hope.

And with that beefing out of the way, maybe now is the time to add that I’m super-impressed with the GShift Labs team and their platform’s contribution to bringing smart SEO strategy down to a meaningful level that the average marketer can implement.

I agree with John Battelle’s rationale for suggesting that Facebook has such widespread ramifications on citizens’ lives that it needs to be subject to all relevant forms of regulation, including the obligations of a public company regulated by the SEC.

Earlier, we argued that Facebook’s top management (with few dissenters, at least in public) seem to believe that Facebook is a world unto itself. That’s a painfully paradoxical approach to “being social”. Social means more than just what a few software developers say it is. It also means occasionally dealing with… the world out there. Companies like Microsoft and Google had to learn this, and Facebook will too.

We do live in a system of laws and obligations, even more so when we are dealing with a privately-held information repository that has potentially the most far-reaching implications for privacy invasion in history. Facebook needs a CEO, not a King.

The narrative is a familiar one. Seemingly intelligent individual hops onto a general-purpose search engine, with a really specific purpose in mind. Gets impatient, has limited background in doing this particular kind of specialized database research, gives up and blames Google or whoever for being spam-ridden and self-interested.

The “search stinks” meme goes all the way back to when the likes of John Dvorak started their articles with that premise over ten years ago. Unfortunately, since search still does stink and I’m still too lazy to really search (like most of the rest of you), when I try to dig up Original Dvorak, all I’m getting is a more recent 2008 piece by him on how the new Cuil search engine stinks. But I digress.

Anyway, Blekko is fine and working on admirable innovation in the search startup space, but this Techcrunch piece by purported academic Vivek Wadhwa does Gooogle – and search, and searchers – a disservice by relying on sweeping generalizations to complain about failed searches, apparently pinpointing the cause of the problem as Google’s bias towards (or inability to filter out) low-quality sites that profit from advertising links.

The example Wadhwa uses is doing reconnaissance on specific individuals in the technology industry. But how would one structure such a search? Are there ways to structure that task so Google, or for that matter Blekko, would perform better?

When I do similar research, I don’t get the same sense of a spammy cesspool that Wadhwa does. Should he elaborate by comparing specifics, like say how the Google “Timeline” feature works vs. Blekko’s /date feature? Should we be probing more about the technology inherent in dating pages as they are published on the Web? Wadhwa unhelpfully tells us that Blekko “analyzes other information embedded in the page’s HTML.” Hate to break it to you, but if Blekko can do it, then Google can easily do it, and probably will.

It’s no secret that Google fails to dazzle on long tail queries. The solution — in part, the innovation Blekko brings to the table — is to sacrifice breadth in favor of imposed structure. By editing out the vast majority of potential publishers of information (and “editing in” curated “thumbs up” high-quality sites), the members of the blekko community may help each other do research with less spam.

For certain, predetermined tasks — assuming a willing army of volunteers to work on the curation database — that’s no doubt going to produce satisfying results. But is this a Google problem? Did Google claim to be solving that problem?

Where we impose structure, we impose significant hurdles in terms of user and community willingness to play along, to say nothing of sacrificing comprehensiveness.

It’s pretty unfair to Google to claim that certain types of unstructured searches were unsatisfying as compared with sites that are more cut out for those tasks — such as LinkedIn! — especially when Wadhwa admitted that LinkedIn proved unsatisfying in itself, despite all the structure it imposes.

There’s a certain Stone Soup quality to the use of a resource like blekko. Confronted with the idea that there are limited resources and a community of volunteer curators, and a need to pick up your searching game to ensure that the tool works to its maximum potential… darned if you won’t pick up your game and make it work by tapping into its full capabilities. Think that might be possible if you just put a bit more elbow grease into Google searches?

The fact that Paul Kedrosky can’t find credible and helpful reviews about dishwashers is a more significant problem. This does point to a troubling fact of life: Google is creating its own way of curating, sorting, and highlighting user-generated content, reviews, local information, etc., and they don’t stack up too well with how many of us are looking to consume review content. At this juncture, it appears that there is a certain quirkiness to how Google returns results based on guessed intent: more generic but popular consumer queries like “bosch dishwashers” actually do *better* than something more pointed like “bosch dishwashwer reviews.” Although you would think that “bosch dishwasher reviews” would give you more helpful results than the more generic result, chances are what you get instead is less curated, less savvy SERP’s, because even that three-word query with “reviews” in it seems to be a pretty low volume query (read: long tail search query). Long-tail queries right now seem to be quite susceptible to allowing these second-rate Made-for-Adsense, non-best-of-breed sites to rank too high, sometimes first on the page.

It can’t be good for Google’s image to be seemingly so incapable of raising their game on what kind of content users access when they type in an obvious query like “bosch dishwasher reviews.” Surely, it shouldn’t be too hard here to get a handle on the notion that dishwasher-review.com is a non-best-of-breed, scrapey-looking, Made-for-AdSense site should never rank in the top five or six results on the page. And shouldn’t, maybe, Amazon and one or two other sites almost always rank here, as TripAdvisor once did for any travel-related review query?

Perhaps the answer is that Google has lost some of its consumer-advocate’s compass or its focus. It’s also the case, of course, that there are so many challenges with spammy content on the open web that it is hard to keep on top of it all.

Personally, I don’t expect to do every type of custom research using a free, general search engine, hence my rejection of Wadhwa’s specific complaint.

But I do expect Google to serve me some pretty impressive results when I type in a mainstream query about dishwashers. Right now, the main SERP’s aren’t always great, Google keeps shifting how it treats these queries, and Google wants to assume my intent is to compare prices, buy immediately, or find a local vendor to buy it at.

Is Google trying to take tire-kicking, researchey intent and gently massage it into more directly commercial intent? At some point did it lose sight of the fact that it advocates for consumers, rather than representing a Yellow Pages 2.0 listing service for businesses that want to conform to its listing formats? Was a line crossed at some point? Many think it may have been, but all that proves is that Google is a for-profit business.

So yes, this just in, Google can’t be expected to do everything, and yes, it’s flawed in key ways. Charges of a cesspool of spam and junk seem overdone, however. And don’t even get me started on the misguided criticisms of perfectly legitimate AdWords search ads that millions of users happily click on every day.